Investor · Newport DE · Member since 2021 · 22 posts · 6 votes
Is there any bank suggestions/recommendations in the Wilmington area that are happy to do a HELOC. My main bank didn't use good comps in my area or any on my street including the one a few houses down that sold in march, and ended up denying my HELOC due to value, and wouldn't respond to my question on why they didn't use houses that compare to my house closer than what they used. I'm looking for a way to gain access to the equity in my home to help me get my first BRRRR going.
Rental Property Investor · Melbourne, FL · Member since 2011 · 3k+ posts · 2k+ votes
4y
Hopefully you have your credit score. Go through the small community banks and credit unions in your local area. Call and ask, "With my fico of ZZZ what rates and terms can you offer me?" No need to have every lender pull your credit and make your score drop.
Make a chart. HELOCs are all over the place, as they aren't regulated the same as traditional mortgages.
Some use an appraiser who will do an indepth process, look inside and out, run comps etc. while many others use Desktop Underwriting and don't see the inside. They get a value somewhat like Zillow or Realtor values...there is a big spread between values done this way. Some are interest only for a decade, some with do longer, while others are not interest only. Rates make be fixed for some time or may fluctuate from the start.
Investor · Wilmington Delaware · Member since 2019 · 40 posts · 25 votes
4y
I have received various recommendations from either WSFS or Artisans. When reading over the Artisans breakdown as @ mentioned the fees are inherited already. Which bank were you using?
Investor · Newport DE · Member since 2021 · 22 posts · 6 votes
4y
@Ronald Stephenson I use TD bank, and I tried a credit union on rt40 between the express car wash and the BWW. Td told me my house was worth 180 on a drive by and the credit Union said 185 based on Zillow’s zestimate. I owe 141 on the house at this point so at those numbers a heloc isn’t worth getting, I do feel as though the appraisal is low. I haven’t gone looking around much more, being I am going to be connected with hard money, and those appraisals are too low to do anything with.
Investor · Wilmington Delaware · Member since 2019 · 40 posts · 25 votes
4y
@Gage Green First, it's always unfortunate to have our appraisals that are different from what the lenders are saying. Second, I'm delighted to hear you are still moving forward with your first BRRR property; which type of property and numbers are you looking for?
Investor · Newport DE · Member since 2021 · 22 posts · 6 votes
4y
If this HML likes the deal I bring him, and the seller accepts my offer, this will actually be a flip. I want to brrrr but this house doesn't work well as a rental, and it would be nice to get some cash reserves in my account. I think I'm going to change my method to start. What I plan to do is flip until I put 20-50k into my account for reserves. If the property works as a brrrr I will brrrr it, but I really think the first couple houses need to be flips to put some money into my account as a cushion. I do not have cash so to be safe it would be wise to have reserves before leaping into the rental world.
As far as what I’m looking for is in the newport/Newcastle area, I’m looking for a 3/2-5/3, or something that will have the potential to add bedrooms. I am looking to cash flow $200+ (after capex/repairs/vacancy/PM) to start with. I will probably PM the first few in order to get a hang of what goes on in the realm. As far as purchase prices I’m not 100% sure just yet. I’m still learning and I still have to figure out what it costs monthly to hold hard money through this lender and what I can afford to pay and for how long etc.
I do have someone who’s willing to help me out financially, however I still need to know what I can afford in case this help falls through for any reason./
Rental Property Investor · Melbourne, FL · Member since 2011 · 3k+ posts · 2k+ votes
4y
Hopefully you have your credit score. Go through the small community banks and credit unions in your local area. Call and ask, "With my fico of ZZZ what rates and terms can you offer me?" No need to have every lender pull your credit and make your score drop.
Make a chart. HELOCs are all over the place, as they aren't regulated the same as traditional mortgages.
Some use an appraiser who will do an indepth process, look inside and out, run comps etc. while many others use Desktop Underwriting and don't see the inside. They get a value somewhat like Zillow or Realtor values...there is a big spread between values done this way. Some are interest only for a decade, some with do longer, while others are not interest only. Rates make be fixed for some time or may fluctuate from the start.
Investor · Wilmington Delaware · Member since 2019 · 40 posts · 25 votes
4y
@Gage Green Sounds like the plan is being built piece by piece nothing wrong with that going through a similar thought process on my next investment property as well. I also, looked into flippin' townhouses in the Wilmington area to build the cash reserves. However, I held off from that to stacking up my reserves before the first flip or BRRR property. I've been looking at Wilmington City plans and apparently there is an old Del Tech out in the area of Newport, more city funds should be piling in that area.
Investor · Newport DE · Member since 2021 · 22 posts · 6 votes
4y
@Kerry Baird my fico on citi says 763, so credit is good. I will start to pursue a heloc again, what should I include in said chart? Rates, if its interest only, term length, % of LTV, fixed or ARM. Is there anything else you'd recommend asking for and jotting down?
@Ronald Stephenson I will be checking both of those links, after I reply to this. As far as timeline goes, I will meet with the lender this week and once I make the offer and the offer is accepted, I’m told this hard money lender has pretty good teams that flip houses in 6-8 weeks, so hopefully from date of purchase I can have it back on the market in 2.5 months at most and sold in less than 30 days. So hold time isn’t anticipated to be any longer than 3.5 months. But those details will get ironed out this week to gain a real understanding of the plans.
Rental Property Investor · Melbourne, FL · Member since 2011 · 3k+ posts · 2k+ votes
4y
@Gage Green, is there a fixed period before the interest rate adjusts? Is it interest-only or does it amortize? What is the maximum the rate can go? Closing costs? Sometimes they are very inexpensive or "free" so that changes your expectations at closing, as well as your return on investment. What type of appraisal? ...is it a full interior or a desktop?